North Tahoe conference center conundrum

Over the years the North Tahoe Community Conference Center developed into an asset for the local community, but operating the Kings Beach venue is a now a financial burden for the North Tahoe Public Utility District.

Faced with a continual operating deficit — even amid the financial restructuring imposed over the past year — the district’s board of directors is weighing its options over the future of the conference center.

Hopes lie in possible subsidies from Placer County and the surrounding business community, which both directly benefit when meeting rooms are booked at the lakefront center.

While a 2006 market study estimated the surrounding community made an additional $2.6 million that year from business directly generated by the conference center — from visitors eating at restaurants and staying in nearby lodging — the facility continues to operate at a loss for the North Tahoe Public Utility District, forcing the district to dip into its recreation budget.

The conference center lost $35,000 during the 2006-2007 fiscal year, said the district’s chief financial officer, Larry Marple. And while the loss is not nearly as severe as in years past — compared to a negative $149,000 at the end of the prior fiscal year — it is an expense the district eats.

“The bottom line improved, but it was still lost money,” Marple said in a phone interview Monday. “We needed to break even.”

In past reports, the district was optimistic that the conference center was digging itself out of debt at a fast pace. But the tone of district directors at their meeting earlier this month was gloomy.

“We either have to look at another business, or we have to look at somebody picking up the subsidy,” board President Lane Lewis said at the early-January meeting. “Because at this rate, we won’t have the money to maintain our recreation responsibilities with Measure C.”

The board has directed staff to research options that could subsidize the conference center’s operations. Staff has since gathered data outlining the economic impact the conference center has on the district, the surrounding community and Placer County — information that would justify it receiving a subsidy.

While the facility stretches the district’s budget thin, the numbers reveal that the conference center is a profitable investment for the district’s residents, business owners and the county.

“Right at this moment, we are always concerned about operating the conference center at a profit or not a profit,” said board Member Frank Mooney at a committee meeting Wednesday. “To me, I’m operating the conference center at a profit — tell me whose books I’m looking at.”

A BIG LOSS The North Tahoe Conference Center’s revenues took a hit late last year when Tahoe Regional Planning Agency, a longtime client, opted to move its bi-monthly meetings to a less expensive venue. Nearly all of the monthly TRPA Governing Board and Advisory Planning Commission meetings this year are scheduled either at the Chateau in Incline Village, or at the agency's Stateline office in South Lake Tahoe. The bistate agency's governing board met every other month at the North Tahoe Conference Center in Kings Beach since "forever," said Dennis Oliver, agency spokesman, in an interview in December. But a rate increase at the conference center spurred the agency to shop around for a better deal TRPA's departure was a significant revenue loss for the conference center, said Director Nora Daniels in a December interview. Conference center staff projected that revenue received from local government agency and business bookings would bring in $150,000 for the 2007-08 fiscal year. The figure is based on past bookings, which included TRPA's monthly meetings. Local government agencies, including the TRPA, receive a 50 percent discount during the slow season and a 35 percent discount during the peak season, which is from May to October.

The county has invested more than $1 million into the conference center since 1988, according to data compiled by district Legal Counsel Neil Eskind. It has since recuperated about $1.25 million through Transient Occupancy Tax and sales taxes.

Data shows another cumulative $40 million in direct community benefit from the conference center over the past 20 years.

“Most conference centers around the country are publicly owned,” Eskind said. “And they expect to lose money.”

But the facilities’ worth is in the surrounding community, Mooney said. The conference center’s loss is the people’s investment.

The board will decide whether to pursue subsidies from Placer County at its next meeting on Feb. 12.

Conference Center History The state purchased the land housing the North Tahoe Community Conference Center, then a bowling alley, in the 1970s. Two weeks before the bowling alley was scheduled to be torn down, Placer County made a deal with the state and acquired the building in a land exchange. The county gave the bowling alley to the North Tahoe Public Utility District on the condition that it be used for community events. In 1987, the district remodeled the bowling alley into the meeting venue it is today. <b>Issue watch</b> A potential land swap between the California Tahoe Conservancy and the California State Parks could further shake up the future of the North Tahoe Conference Center. While nothing is finalized, the land swap would give the state parks’ portion of the beach to the conservancy, which could complicate the district’s management of the parking lot — a vital asset to the conference center. While the North Tahoe Public Utility District owns the meeting venue and three-feet surrounding the building, the state agencies own the beach properties that make up the Kings Beach State Recreation Area. The district has traditionally maintained the beach properties in return for maintenance funds from the conservancy, which cover the cleaning and upkeep expenses, and an operating agreement with the state, which allows the district to charge parking and operate concessions.